Moxico Resources to Acquire Interests in Two Copper Projects in Argentina

Atlantic Metals, a subsidiary of Moxico Resources, has entered into a binding letter of agreement with Latin Metals, a mineral exploration company, to acquire a 75% interest in two copper exploration projects in Argentina. This agreement grants Moxico the opportunity to earn stakes in Latin Metals’ Esperanza copper-gold porphyry project and the Huachi copper exploration project.

To exercise this option, Moxico must meet a sesries of financial and operational milestones, including scheduled payments and drilling obligations. As per the agreement, Moxico is required to make cash payments amounting to $2.78 million (£2.12 million) to Latin Metals and take on the existing payment liabilities of $4.63 million owed by Latin Metals to the original owners of the projects. Furthermore, Moxico is obligated to invest $1 million in work expenditures at the Huachi project and complete a minimum of 65,000 meters of drilling across both projects. Additionally, Moxico must produce independent technical reports, which will include a mineral resource estimate, a preliminary economic assessment, and a bankable feasibility study.

Upon fulfilling these conditions, Moxico will have the chance to increase its ownership to 100% by making an extra payment to Latin Metals. This payment will be either $10 million or an amount calculated based on the copper equivalent in the measured and indicated resource categories, whichever is greater.

Keith Henderson, President and CEO of Latin Metals, highlighted the potential of the Esperanza project, noting that it has already undergone 8,500 meters of drilling, with the best intersection revealing 387 meters grading 0.57% copper and 0.27 grams per tonne of gold from the surface. This includes an impressive 166 meters grading 0.84% copper and 0.37 grams per tonne of gold from the surface. Henderson expressed anticipation for the exploration results that Moxico will conduct.

If Moxico decides to exercise its option for additional ownership, Latin Metals will retain a 2% net smelter returns royalty. Both companies have agreed to negotiate a definitive earn-in and purchase option agreement within 60 days following the first anniversary of the effective date, as long as the option remains active.

Once the option is exercised and considering the potential for additional ownership, Moxico and Latin Metals will establish a joint venture, with initial ownership stakes of 75% and 25%, respectively. This partnership aims to further explore, develop, and commercialize the projects if they prove to be viable.

Latin Metals is a mineral exploration company focused on building a diverse portfolio of assets across South America. The company employs a Prospect Generator model, which emphasizes acquiring promising exploration properties at minimal expense. It conducts initial evaluations through cost-efficient exploration methods to identify drill targets and subsequently seeks joint venture partners to finance drilling and advanced exploration activities.